Budget session lesson for state rep.

State Representative Brent Talley, D-McCaskill, now knows what it feels like to be responsible for $5 billion.

Ken McLemore, Hope Star Editor

State Representative Brent Talley, D-McCaskill, now knows what it feels like to be responsible for $5 billion.

Talley told members of the Hope Rotary Club recently that the 2014 fiscal legislative session which wrapped up in March was an eye-opener for him.

“For those thirty days, we focused primarily on the state's $5 billion budget; yes, the State of Arkansas has a $5 billion budget,” Talley said. “That is what we operate on, and our job is to keep that budget balanced.”

He said the Arkansas General Assembly added some $65 million to the public schools foundation fund, which currently totals $2.6 billion, slightly more than half of the entire state budget.

Talley said other increases included $3.1 million in new funds to state prisons; $7 million in turnbacks to county jails; $2 million for enhanced breast cancer research; and $5 million more for public schools technology to convert the state's standardized testing system to an electronic format. Most of those funds were one-time appropriations, he said.

Overall, state revenues have produced about a $100 million surplus, Talley said.

“That looks like a whole lot of money in my checking account; but, it's not a lot in the state's,” he quipped.

But, Talley said those funds are already being eyed for appropriations in the next biennium to take care of gaps in teacher and state employee insurance costs.

“We have task force studying that; and, those are both high-dollar issues,” he said. “So, when you start looking at those issues, and educational adequacy and equity, that is just not a whole lot of extra money.”

One of the headache issues of the session was an override to a line-item veto which Governor Mike Beebe issued concerning the taxable status of certain oilfield drilling bulk materials. Talley said the veto was overridden, but he sided with Beebe on the issue.

The key issue in the session was the funding of the so-called “private option” for the expanded Arkansas Medicaid program. The program allows Arkansans without health insurance who qualify to purchase that insurance through one of four private carriers in Arkansas using federally-backed funds.

Talley said 25 percent of adult Arkansans have no health insurance coverage, and the rollout of the “private option” in conjunction with the federal Affordable Care Act was not as smooth as anticipated.

“My phone has been ringing off the wall,” he said.

Still, he said consultants retained to study the plan reported that it would produce tax savings and cost savings over time.

Talley said the failure to get enough votes in the Arkansas House of Representatives through three successive votes created fears that the “private option” might not be funded.

He said the program affects some 155,000 Arkansans who have never been able to obtain health insurance.

As the fight over funding the program grew, so did the realization that federal money would be withdrawn, and with $150 million in tax cuts which had been passed last year in anticipation of the tax savings from the “private option”, Arkansas might be left with a $90 million hole in the budget.

“It started hitting home real quick; if that failed, it wasn't just the private option, but a lot of essential services,” Talley said. “And, there are still a lot of different triggers that can stop this.”

But, he said any budget cuts necessary to replace the funds would hurt rural hospitals and would likely affect programs such as the “workforce” funding which the University of Arkansas Community College at Hope and other colleges receive. And, he said new funding to prisons and county jails would likely have gone away.

“Some of my colleagues and I walked into the governor's office scratching our heads, and said, 'Governor, what are we going to do?' And, he said, 'Get your pencil and paper out and find $90 million in the budget that is going to come out.'”

As a result, a consensus eventually developed, Talley said.

“This is not something that just one party did,” he explained. “We all had to work together on it.”

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